YouTube Ad Revenue Pops 46% to $6.89 Billion, Fueling Alphabet Q4 Results

Elaine Low
·2 min read

Google parent Alphabet handily topped fourth-quarter forecasts, with Google Search and YouTube driving up total revenue for the internet giant.

Wall Street analysts had expected earnings of $15.90 per share on revenue of $53.1 billion. The company reported $22.30 in per-share earnings on total revenue of $56.9 billion, marking 45.3% and 23.5% growth, respectively.

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“Our strong fourth quarter performance, with revenues of $56.9 billion, was driven by Search and YouTube, as consumer and business activity recovered from earlier in the year,” said Google and Alphabet CFO Ruth Porat in the company’s earnings report. “Google Cloud revenues were $13.1 billion for 2020, with significant ongoing momentum, and we remain focused on delivering value across the growth opportunities we see.”

On the call, Pichai said that the company more than doubled the number of advertisers on YouTube through its TrueView ad format, and touted the platform’s e-commerce and educational abilities. YouTube’s brand business was “hit hard” in the early stages of the pandemic, he said, but rebounded in Q3 and Q4. Additionally, watch time is increasing on the platform.

Google Services revenue, which makes up the majority of Alphabet’s revenue, grew 22.4% to $52.87 billion during Q4. Google Cloud revenue rose 46.6% to $3.83 billion, and Alphabet’s “Other Bets” revenue ticked up 14% to $196 million. Google Cloud operating losses increased slightly however to a loss of $1.24 billion, while Google Services operating income grew 41.4% from the prior-year quarter.

The quarter’s results “reflect the helpfulness of our products and services to people and businesses, as well as the accelerating transition to online services and the cloud, ” said Google and Alphabet CEO Sundar Pichai in the report. “Google succeeds when we help our customers and partners succeed, and we see significant opportunities to forge meaningful partnerships as businesses increasingly look to a digital future.”

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